How one fake press release on a Google “acquisition” fooled the press

Did Google buy ICOA? No. Did media outlets run with the story anyway? Yes.

If you're the kind of person who obsessively reads technology news stories, this morning you might have seen about a dozen headlines touting a $400 million Google acquisition of a Wi-Fi hotspot provider called ICOA.

The storieswereall attributed to an announcement made by Google. The only trouble is, Google didn't make the announcement at all. And ICOA now says the story is entirely false.

Oops

So how did this story get so widely distributed? The answer is media outlets writing about it didn't contact Google or ICOA before pumping out their stories, relying solely on a press release that didn't come from either company. ICOA's stock (worth less than a penny) soared on the fake news and then, just as suddenly, fell back down to earth. This leads to the natural assumption: someone must be profiting off this little mess.

"This is absolutely false!” ICOA CEO George Strouthopoulos told TechCrunch in an e-mail. "Someone, I guess a stock promoter with a dubious interest, is disseminating wrong, false, and misleading info in the PR circles.” A story in BuzzFeed quotes Strouthopoulos as saying the source of the hoax is from Aruba. The Securities Exchange Commission has reportedly halted trading on ICOA's stock at ICOA's request.

TechCrunch's original story, titled "Google Acquires US National High-Traffic Broadband Wi-Fi Provider ICOA Inc. For $400M," has been updated to blame "a PR agency or some other individual gone rogue."

But TechCrunch was far from the only one duped. This is the kind of story that leads to headlines like "Google pays $400 million for wireless internet provider ICOA (update: no it didn't)." Even the Associated Press was fooled, and that untrue AP story was left on the Washington Post website and elsewhere for a couple of hours before being removed.

It was great material for anyone who likes to parody the tech media, such as one of my favorite Twitter accounts, @NextTechBlog:

The press release that caused this whole thing was published on a site called PRWeb and nowhere else. Neither Google nor ICOA made any announcement on company sites. Vocus, which runs PRWeb, doesn't reveal exactly who submits press releases to them. It also doesn't check for accuracy. When I spoke to someone who answered the phone in Vocus's editorial services department, I was told "We don't go out and vet their sources. We make sure there's nothing damaging to their business and ours." They also check for grammatical errors. The link to the press release is now redirecting to the PRWeb home page.

Seems legit

The release was just two paragraphs, and it listed ICOA's website and phone number as contact information. It provided some quick facts about how great ICOA technology is, then said Google made the buy to "diversify it's already impressive portfolio of companies."

News is often reported quickly when the original source appears to be legitimate, often without contacting every possible source. ICOA builds Wi-Fi hotspot infrastructure in airports and other public places. Google has Google Fiber Internet-to-the-home in Kansas City, offers free Wi-FI in its hometown of Mountain View, CA, and sponsors Boingo hotspots in many locations. Buying a maker of Wi-Fi hotspot technology seems like it would fit into Google's natural progression.

I admit I was fooled too, at first. But there were some red flags beyond just grammatical errors in the press release.

The press release was titled "ICOA Inc. Acquired by Google for $400 Million," and the first two sentences say "Google has announced its acquisition of ICOA Inc. A provider of Wi-Fi to high traffic public locations." (Yes, those are two sentences, but a properly placed comma could have made the whole thing grammatically correct.)

The magic words "Google has announced its acquisition" were enough for many news stories to report the deal was announced from on high by Google itself. But when Google announces acquisitions, it typically does so with a press release on Google.com and with a blog post on its official blog. In this case, Google did neither.

The thing that really puzzled me was why Google would buy ICOA rather than some other, more successful company (like, I dunno, Boingo). ICOA's website is severely out of date, quoting 1,500 broadband access installations "as of January 1, 2006." The company announced a Wi-Fi roaming agreement for airports with Boingo in 2004 and a deal with Denny's restaurants in 2006. But things weren't going so well. In October 2010, ICOA said it was developing a new business strategy to adapt to the "changing dynamics within the Wi-Fi industry," and hasn't issued any press releases at all since December 2010.

I e-mailed Google to ask why it would buy ICOA, but did not receive any on-the-record response, not even a confirmation that the acquisition took place. This alone wasn't proof that Google hadn't at least talked to ICOA about an acquisition. That would come later, when Strouthopoulos told TechCrunch his company "Never had any discussions with any potential acquirers."

Companies often decline comment on acquisitions when they are still pending and being negotiated. A non-denial denial isn't enough to prove something is untrue. But the story media outlets were running with was that Google announced an acquisition. That was demonstrably false. After an hour or two of the story being repeated unskeptically, some slightly more definitive word came from AllThingsD, which credited Google sources with saying the whole thing was a lie.

So was there some stock fraud going on here, as the ICOA CEO suspected? We don't know for sure, but releasing false news to raise a stock price would certainly lay the groundwork for a classic pump and dump scheme.

Publishing a fake press release would also be a good way to prove how easy it is to fool reporters. It wouldn't be the first time. Just last year, many tech media sites published stories about a study purportedly showing that Internet Explorer users have lower IQs than users of other browsers. (Spoiler alert: it was a hoax.)

No one's perfect. But a few minutes of digging, Google searching, e-mailing, and phone calling is usually enough to prevent false news from hitting the wire.

This is why I read Ars. A few minutes worth of fact checking prevented them from making fools of themselves.

I second this. Ars's front end acts like a tech blog but they've been doing this for the equivalent of Eons in web years. I consider their writers as actual journalists. Too many tech bloggers are just enthusiastic writers. There is no excuse for lack of fact checking. Too many PEOPLE in this world think they just know better and don't bother with annoying little things like facts.

Alternate headline: "Breathless bloggers desperate for their "first post" news once again prove they know zilch about journalism"

Probably a bit long, but the bloggers themselves teach us that it's better to post the first thing you think of and check for facts later. Maybe. If you have time. But really, who has time these days? I mean, I've got heaps of stuff to do, and it's not like accuracy is that big a deal anyway. So what was I talking about? Oh yeah, let's get coffee and talk about how cool VCs are and how many page views we're getting.

/rant

Seriously though, this story does once again highlight the deep divide between old and new journalism. Thanks Jon, that was very informative.

Of course it's sites like Engadget and Techcrunch that got "fooled" here. There is a reason nobody with a modicum of intelligence respects those sites at all, what a joke. I'm a little surprised at the AP though... Did Reuters fall for this too?

Off topic- what's with the twitter screenshot? Why not embed the tweet so we can see live numbers and click through to the guy's profile? Seems kinda old school for a tech sit such as Ars to take a screenshot when a better, easier option exists. But correct me if I've embarrassed myself...

Off topic- what's with the twitter screenshot? Why not embed the tweet so we can see live numbers and click through to the guy's profile? Seems kinda old school for a tech sit such as Ars to take a screenshot when a better, easier option exists. But correct me if I've embarrassed myself...

I'll correct you. Twitter is blocked a lot of places. Like where I am currently sitting.

Sadly enough, this is the normal state of affairs in the news world. While this is a pretty high profile case, many news sources - and this includes such sources like AP - report things without much verification. A favorite tactic is to just quote the boulevard rag which reports it and say something like "as the paper X writes ..."By now such things even go on world tours: there was a supposed case where a man in China divorced his wife because she had had a ugly baby. This was told in a German boulevard paper, which had it from the Irish Examiner, which had it from Planet Ivy (a web portal) which in turn had it from interaksyon.com (a portal from the Philippines) . Huffington Post and Daily Mail quoted Fox31 from Denver which had written about the story 2 days after Planet Ivy. The original story apparently came from the Pakistani Daily Times back in 2004 and didn't have any sources to quote. I translated this from a German Portal which tracks such things in Germany at http://www.bildblog.de/43457/das-haessl ... rnalismus/

The more spectacular somethings sounds like, the more likely it is a bunch of crap and it is difficult to protect yourself from those things except keeping your distance and looking if you can find it on several portals you have come to trust because they've reported accurately in the past. Oh, and don't retwitter such bull or something unless you're damn sure yourself.

@Ars: you guys do like to push the buttons and generate traffic with some stories, but so far I've always found you accurate and have given the people involved the chance to take a stand here. (Not that it has always helped them) Keep up the good work

Off topic- what's with the twitter screenshot? Why not embed the tweet so we can see live numbers and click through to the guy's profile? Seems kinda old school for a tech sit such as Ars to take a screenshot when a better, easier option exists. But correct me if I've embarrassed myself...

The other problem with embedding tweets is that you're basically ceding editorial control over a part of your story to someone else. If it's a controversial tweet for instance there's no saying that the owner won't go back and delete it, leaving your article with a hole in it.

This is why I read Ars. A few minutes worth of fact checking prevented them from making fools of themselves.

That's true of every bug I've ever written or discovered. It was invariably just some simple typo or something I overlooked, and just a few minutes would have prevented however many hours I spent tracking it down and fixing it.

This sort of thing was why publications like Readers' Digest had a fact-checking department. Unlike the current fad of fact-checker who check everyone else, these guys would check their own writers. My dad used to write for Readers', and he'd be fuming about "all this ruddy nonsense, they want me to bloody well prove every last thing I write."

It's because journos are a lot like developers: they have a mentality that is naturally distracted by something shiny, and they have hard deadlines to meet. So even if they aren't distracted by a squirrel, there's a time crunch. Neither of these lend themselves to systematically scrutinizing copy.

I'm not sure how much worse it actually is, but I'm curious, does this change anyone's perceived value of these news sources? If there's no downside to getting this wrong (or upside to getting it right), what's their lasting incentive to fix this? Ars gets to, effectively, scoop the guys who got it wrong, but the bragging rights aren't worth much that I can see.

Spelling and grammar mistakes may seem like nitpicky things to get hung up about, but they usually signify unprofessional writing. This can make a world of difference when you're trying to decide the legitimacy of an article or an email that you're reading. The grammar police, much like the actual police, is occasionally worth listening to

I remember a long time ago, right when online stock trading made a debut, that one of the companies that facilitated this had to eliminate chatrooms on the site. People were buying penny stocks, then going in chat and doing this same PR tactic, getting a lot of traction on the stock just to sell it off quickly and make a fast profit.

This was a pump-and-dump. What the author didn't say is that the whole damn market is nothing but a giant pump-and-dump!

Just look at all the Eurocrats and their various announcements but then fail to follow it up with any real action! They are just pumping the market up! Same in the USA with all this "fiscal cliff" chatter! Sell, sell, sell, until the next meeting of principles and they all exit with a positive pronouncement of progress being made, buy, buy, buy.